Dynamic EMS Supplier Day Tackles Efficiency in EMS Supply Chain

Estimated reading time: 3 minutes

Dynamic EMS recently hosted a supplier day at the company's manufacturing headquarters in Dalgety Bay, Fife, Scotland. The event brought together top executives from Dynamic EMS and representatives from the company's main distribution partners to discuss issues in the industry, and look to improve the overall efficiency of the supply chain.

To ensure visibility over the whole supply chain, the company invited representatives from broadline, catalog, and specialist distributors, as well as service providers and suppliers of mechanical products. Companies attending included Digi-Key, Avnet Abacus, Arrow Electronics, Rutronik, Farnell element14, Future Electronics, Rebound Electronics and America II Europe.

The day was kicked off by Dynamic EMS Managing Director and Owner John Dignan, who outlined the strategy and growth plans implemented since his takeover in 2014 and provided a progress report. He stressed the importance of the supply chain to the company and as part of the transparent culture he is trying to foster, inviting the attendees to contact anyone necessary in the company, whenever required.

The remainder of the event was led by Supply Chain Manager Paul Freeman, who ran through the current situation at the company and discussed opportunities and issues in the marketplace that could affect business in the near to midterm future. Subjects covered included supporting the company’s growth plans, rising prices, the challenges to the supply chain from Brexit, currency fluctuations, and manufacturer’s decreasing inventory levels which could possibly lead to distributors reintroducing allocation. He then looked at the supply chain and how it was changing and iterated that both Dynamic EMS and its supply chain partners needed to adapt together to prosper, and the best way to achieve this aim was to share best practices and form even closer relationships.

“The business environment is dramatically changing. Companies like us face the challenge of increasing competition, expanding markets, and rising customer expectation. This increases the pressure on companies to lower total costs in the entire supply chain, shorten throughput times, and drastically reduce inventories. Procurement of components makes up the biggest part of our spend. The suppliers who attended on the day made up around 85% of the company’s procurement spend. Days like today allow us to face the challenges ahead together, share ideas, and identify savings, which are required, especially in times of growth, to ensure optimal cash flow,” said John Watt, Dynamic EMS financial director.

This is the third time Dynamic EMS has brought its supply chain partners together. After the previous two occasions, the company has investigated all suggestions from its partners and implemented solutions based on these suggestions whenever possible. Freeman detailed some examples of these solutions during his presentation. These included Digi-Key helping to make stock easier to buy by guaranteeing prices for regular orders, and Farnell element14 assisting the company to move to an electronic invoicing solution.

Farnell element14’s CEM business manager Bill Platt explained, “There is a limit that prices can drop, and after that, it is necessary to look at other ways to try save money. Hidden costs can affect procurement by taking up too much staff time. At the last supplier day, I suggested that Dynamic EMS switched from paper invoicing to our new e-invoicing portal. When a company has many invoices every month, the cost and time savings add up quickly for both the customer and supplier. The e-invoicing system is also very flexible and allows Dynamic EMS to quickly see and compare old orders and past spending.”

Debbie McCluskey of Avnet Abacus also emphasizes the benefits for both the distributor and Dynamic EMS. “This is the second supplier day that I have attended, and I find the day valuable. It not only gives us insight into how Dynamic EMS operates, but also its customers – the designers. Having visibility over the whole product design cycle allows everyone to reach further together,” she said.

To summarize, Dignan said, “The supplier day provides a forum for a frank discussion of ideas between ourselves and our supply chain partners, allowing us to identify mutual savings and work together more effectively in the future. Our focus on long-term customer relationships gives us a unique view of the whole product design and manufacturing process, and that is of great value to our suppliers. Because we are privately owned, we can be more agile than our competitors, meaning ideas from the event can be implemented very quickly. Every supplier day so far has provided a wide variety of ideas, and the feedback from my management team suggests this year is no different.”